Solar Energy

The Hon. M.C. PARNELL (15:34): I wish to speak today about the difficulties being faced by small and medium sized enterprises and by non-profit organisations in their desire to install solar panels as part of a strategy to reduce their energy costs. Members who followed this debate over the last little while might have come across a number of articles in the specialist energy media describing the various tactics used by distribution and retail companies to discourage and discriminate against people who either have solar panels or want to install them.

One such article, by Mr Nigel Morris, who is the proprietor of Solar Business Services, is entitled 'How the electricity industry is blocking solar in Australia'. It is a lengthy article in two parts, and he raises a number of issues that are directly relevant to South Australia. I just want to focus on two issues. The first issue is the practice of SA Power Networks of moving some small to medium business customers onto a new tariff known as a demand tariff when they seek to install solar panels.

Whilst this has happened to a number of companies, a large number have also seen the writing on the wall and realised that if they go solar then SA Power Networks will penalise them by moving them onto a different tariff. This demand tariff means that charges are calculated according to the maximum expected rather than the actual demand for electricity, and there is less reliance on actual electricity consumed and a higher reliance on fixed charges.

This is also known as a fixed kVA charge. In effect, this means that a business or not-for-profit organisation that has intermittent consumption, but low average consumption, will be charged at a higher rate as if they consumed a high amount of electricity for the entire year when in fact their actual consumption over a period of a year might be quite low. A classic example would be a sporting club that uses a lot of electricity on the day of their Christmas party and hardly any electricity for the remainder of the year.

Businesses that might otherwise have been able to afford to put solar PV panels on their roof find that they are unable to do so unless they get taxpayer-funded grants, and that is assistance that, as members know, has been evaporating over the last several years. It makes no sense that small businesses and not-for-profit organisations that want to embrace the solar energy revolution are dissuaded from doing so because of the tariff structures imposed by SA Power Networks. One constituent who wrote to me said:

I would appreciate any assistance you may be able to offer in instigating a change in policy to prevent [SA Power Networks] from charging [small and medium-size enterprises] who have power boards of 100 amps or greater to Fixed KVA Charging upon the installation of PV.

Another constituent who had similar experiences of discrimination was a tennis club in South Australia. They used the following metaphor:

What [SA Power Networks] is doing is like raising the height of the ocean to preserve the height of the waves.

Next week, I will be convening a meeting of solar energy stakeholders, and we will be looking at what options are available to us to try to end this discrimination against solar. Another area of discrimination is in relation to the increasing number of people who want to supplement their home or small business solar power supplies with battery storage. As members know, for the early adopters of solar power, there was a feed-in tariff of 44¢. For those who came in after 2011, there was a lower feed-in tariff of 16¢, and new installations today do not attract any feed-in tariff. But those who are eligible for the feed-in tariff can lose that tariff if they upgrade the size of their system.

That might seem a fair thing, but what is happening is that SA Power Networks is telling people that if they add batteries to their system, they will also lose their feed-in tariff. This makes no sense, I think, either in law or in policy, because those people who are adding batteries to their solar systems are, in fact, storing the energy that they have already produced with their solar panels. They have not increased the capacity of their system to generate electricity. They are simply being a bit smarter about how they use that electricity, so I do not believe that it is at all right in law or in policy for them to be taken off their feed-in tariff.

SA Power Networks says, in its defence, that they are only complying with the legislation, but I make the point that they choose to interpret that legislation in a way that makes it as difficult as possible for people to innovate. Going back to the article by Nigel Morris of Solar Business Services, his description of the problem in South Australia (he identifies it as problem No. 8 on his list of about 14) is, 'Don't get clever,' and he nominates South Australia as the worst example of utilities stopping people from innovating. I think that the task is now before us as legislators to revisit the Electricity Act next year. I certainly put on notice now my intention to come back to this place to try to make sure that we have laws which are fair to everyone and which allow all manner of individuals and businesses to embrace the solar revolution.